Economic Evaluation of the $35 Insulin Copay Cap Policy in Medicare and Its Implication for Future Interventions

The price of insulin has increased threefold since 2007 (1), imposing a substantial economic burden on patients and payers, which has resulted in reduced insulin adherence and dosage rationing (2). Significant legislative efforts were made in 2022 to cap the copayments needed to access insulin to $35 per month to ensure its affordability. In a previous analysis (3), we showed that this copayment cap policy is likely to reduce copayment for insulin by about $500 per year for 1.6 million people and avoid thousands of diabetes complications and fatal events that would lead to generating an additional 32,000 life-years and 21,000 quality-adjusted life-years (QALYs). However, even after accounting for the cost-saving due to a reduced risk for diabetes complications, the policy would still increase total medical costs by $5.6 billion over 20 years. To assess whether the additional costs are justifiable, in this work, we report the cost-effectiveness of this policy and draw economic implications on future policy interventions.

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